Property Flashcards
4 Present Possessory Estates
(1) Fee Simple Absolute
(2) Defeasible Fees (3 Species)
(3) Fee Tail
(4) Life Estate
Fee Simple Absolute: 3 Features
“To A” or “To A and His Heirs”
(1) freely alienable (transferable)
(2) freely devisable (capable of transfer by will)
(3) freely descendible (will pass to heirs if holder dies intestate)
Absolute ownership of potentially infinite duration
Fee Simple: “Heirs”
A living person has no heirs.
A living person has heirs apparent or prospective heirs, not ascertainable until A’s death. There is no future interest.
Defeasible Fees: 3 Species
3 Fee Simples–> To A, with a Catch
(1) Fee Simple Determinable
(2) Fee Simple Subject to Condition Subsequent
(3) Fee Simple Subject to Executory Limitation
Fee Simple Determinable
“To A, so long as she remains a lawyer”
Clear durational language
*Always subject to the stated condition. If the stated condition is violated, forfeiture is automatic.
Freely alienable, devisable, descendible.
Possibility of reverter (the future interest) belongs to the grantor.
Fee Simple Subject to Condition Subsequent
“To Rachel, but if coffee is ever consumed on site, grantor reserves the right to reenter and retake.”
(1) Grantor retains right of entry (power of termination, statement of right of reentry).
(2) Clear durational language.
Can be terminated at the grantor’s prerogative. NOT automatic. Grantor can choose to look the other way.
Fee Simple Subject to Executory Limitation
“To A, so long as she remains a lawyer, but if she leaves the legal profession, then to B”
A has a fee simple subject to executory limitation
B has a future interest called a shifting executory interest
Automatic forfeiture occurs in the event of the condition’s breach BUT in favor of someone other than O, the grantor.
3 Rules for Construction for Defeasible Fees
(1) Words of mere intention, desire, or hope are inadequate to encumber an estate as a defeasible fee (courts hate conditions)
(2) Absolute restraints on alienation are unenforceable (must be linked to rxble time limited purpose) [repugnant to public policy]
(3) Restraint on alienation linked to a rxble, time-limited purpose is valid
Life Estate
“To A for life”
“Romantic Estate”
Must be measured in explicit lifetime terms, and NEVER in term of years.
Life Estate Pur Autre Vie
“To A for the life of B”
Life estate measured in the terms the lifetime of another
Reversion
Future interest in a life estate held by the grantor.
“To A for life”
O has a future interest called a reversion. If O is dead, it reverts back to O’s heirs.
Remainder– Life Estate
Future interest in a life estate held by a 3rd party.
“To A for life, then to B”
A has a life estate, B has a remainder
2 Rights and Duties of the Life Tenant
(1) life tenant is entitled to all reasonable uses and profits from the land
(2) life tenant must not commit waste; must not do anything to injure the future interest holder
3 Species of Waste in Life Tenancies
(1) Voluntary/Affirmative Waste– willfull destruction
(2) Permissive Waste– neglectfulness, remiss, disregard (i.e. not patching kitchen ceiling, which leads to ceiling collapse).
(3) Ameliorative Waste– may not engage in activities that enhance the property’s value unless all future interest holders are known and consent (sentimental value and rxble expectations)
Voluntary Waste and Natural Resources: General Rule
Life tenant must not consume or exploit natural resources on the property (such as timber, oil, or minerals) unless one of the four exceptions applies [PURGE]
4 Exceptions to the Life Tenant’s Duty Not to Commit Voluntary Waste
PURGE
Prior use: prior to grant, land used for exploitation, life tenant may continue unless otherwise agreed.
Reasonable repairs: life tenant may consume natural resources for repairs and maintenance
Grant: life tenant may exploit with express grant
Exploitation: land is suitable only for exploitation unless otherwise agreed (e.g. a quarry)
Open Mines Doctrine
Tenant may continue to mine but is limited to already open mines.
Tenant cannot increase the rate of extraction or open new mines or wells, EVEN IF the old extraction source has been exhausted
Permissive Waste Obligations (2)
(1) Obligation to Repair: life tenant must simply maintain premises in rxbly good repair so not to harm the future possessors’ interests
(2) Obligation to pay all ordinary taxes: life tenant must pay all ordinary taxes on the land, to the extent of any income or profits life tenant is reaping from the land. If no income or profit, life tenant is required to pay all ordinary taxes only to the extent of the premises fair rental value
6 Categories of Future Interests
FUTURE INTERESTS CAPABLE OF CREATION IN O THE GRANTOR
(1) Possibility of reverter
(2) Right of entry aka power of termination
(3) Reversion
FUTURE INTERESTS IN SOMEONE OTHER THAN O (TRANSFEREE)
(4) Vested remainder
(5) Contingent remainder
(6) Executory interest
Possibility of Reverter
Accompanies only the fee simple determinable.
Ex: O conveys to A so long as popcorn is never made on the premises. A has a fee simple determinable (present possessory interest); O has the possibility of reverter (future interest)
Right of Entry
AKA power of termination
Accompanies the fee simple subject to condition subsequent.
“Bobby Brown’s prerogative to terminate in the event of the condition’s breach.”
Ex: O conveys to A, but if coffee is ever consumed on site, O reserves the right to reenter and retake. O has a right of entry; A has a fee simple subject to condition subsequent.
Reversion
Future interest that arises in a grantor who transfers an estate of lesser duration than she started with, other than a fee simple determinable.
The leftover, the catch-all.
O, holder of a fee simple absolute, conveys to A for life or to A for 50 years. A has a reversion.
3 Future Interests Capable of Creation in O (Grantor)
(1) Possibility of reverter
(2) Right of entry (AKA power of termination)
(3) Reversion
3 Future Interests Capable of Creation in Transferees
(1) Vested remainder
(2) Contingent remainder
(3) Executory interest
Remainders
“Must I always be waiting, waiting on you”
Future interest- created in a grantee (entities other than O) that are capable of becoming possessory on the natural conclusion of the present estate.
Have to be sociable; tagalong to a present possessory estate of finite duration. Typically follows a life estate or a term of years.
NEVER follow the defeasible fees!
Contingent Remainder
A remainder is contingent where it is either
(1) created in an as-yet unknown taker (to A for life, and then to her firstborn child. The as yet unborn child has a contingent remainder)
(2) subject to an as-yet unmet condition precedent or prerequisite to his entry onto the land (to A for life, and then if he graduates from law school, to B)
OR BOTH
Vested Remainder
A remainder is vested if it is both
(1) created in a known taker, who
(2) is not subject to a condition precedent or prerequisite to his entry onto the land
Vested Remainder: 3 Subcategories
(1) Indefeasibly vested
(2) Vested remainder subject to complete defeasance
(3) Vested remainder subject to open
Indefeasibly Vested Remainder
“No Strings Attached”
To A for life, then to B
- B exists and is alive
- A exists and is alive
A has a life estate
B has an indefeasibly vested remainder
If B predeceases A, at common law B’s future interest passes by will or intestacy
Vested Remainder Subject to Complete Defeasance
“Comma Rule”
Subject to forfeiture if condition subsequent manifests.
To A for life, then to B, but if B leaves the legal profession, then to C
A- present possessory life estate
B- vested remainder subject to complete defeasance b/c of condition subsequent
C- Shifting executory interest
Comma Rule
When conditional language in a transfer follows language that, taken alone and set off by commas, would create a vested remainder, the condition is a condition subsequent and you have a vested remainder subject to complete defeasance
Vested Remainder Subject to Open
Remainder is vested in a group or category of takers, at least one of whom is eligible or qualified to take.
To A for life, and then to A’s children.
A is alive, and has children B and C. A has a life estate. B and C have vested remainders subject to open.
Group or category may increase in size.
When is a class open?
When others can still join
When is a class closed?
When no others can join
Rule: class closes when any member can demand possession.
Womb rule
Child in utero will share in class
Executory Interest
Future interest created in a grantee that takes effect by CUTTING SHORT another. Typically follows a defeasible fee.
Takes effect b/c of the estate holder’s forfeiture.
Springing Executory Interest
Cuts short the grantor.
“O conveys Blackacre to A when he marries” [A is presently unmarried]
When A married, A will divest O
O has a fee simple subject to A’s springing executory interest
Shifting Executory Interest
Cuts short another transferee. Always follows the defeasible fee.
“O conveys to A but if A ever uses the premises for non–residential purposes, then to B”
A has a defeasible fee simple subject to B’s shifting executory interest. B has a shifting executory interest.
Rule Against Perpetuities
Certain kinds of future interests are void if they vest too remotely. They must, to be valid, be certain to be capable of vesting within the so-called perpetuities period. They must be capable of becoming possessory within 21 years after the death of a relevant life in being.
To be valid, it must be a certitude at the time of the grant’s creation that we will know who gets to take in the future within 21 years after the expiration of the relevant measuring life
4 Step Technique for Tackling Rules Against Perpetuities Challenges: Step 1
Determine which future interests have been created by the conveyance.
The RAP potentially applies ONLY to the contingent remainders, executory interest, and certain vested remainders subject to open.
The RAP does NOT apply to any of the 3 future interests capable of creation in O, the grantor (possibility of reverter, right of reentry, and reversion).
Doesn’t apply to indefeasibly vested remainders or vested remainders subject to complete defeasance.
4 Step Technique for Tackling Rules Against Perpetuities Challenges: Step 2
Ask, what has to happen for the future interest holder to take?
Ex: to A for life, and then to A’s children
A must die, leaving behind a child
4 Step Technique for Tackling Rules Against Perpetuities Challenges: Step 3
Find a measuring life.
Look for a person, alive at the date of conveyance, whose life and/or death is relevant to the condition’s occurrence
Ex: to A for life, and then to A’s children
Measuring life: A
4 Step Technique for Tackling Rules Against Perpetuities Challenges: Step 4
Dispositive inquiry: will we know for sure within 21 years of the death of that measuring life if there is or is not a future interest holder to take?
Ex: Yes. We will know at the moment of A’s death if she left behind a child or not.
2 RAP Bright Line Rules
(1) An executory interest with no limit on the time within which it must vest violates the RAP
Ex: O conveys to A as long as alcohol is never served on site, and if alcohol is served, to B.
A has a fee simple subject to B’s shifting executor interest. A gets a fee simple determinable with possibility of reverter to O.
RAP will not assert itself w/r/t future interests capable of creation in O
(2) A gift to an open class condition on the members surviving to an age beyond 21 violates common law RAP. "Bad as to one, bad as to all."
“O conveys to A for life, then to such of A’s children as live to the age of 35.” A is alive, class is still open.
Reforms to the RAP: Wait & See/Second Look
“Wait and See” AKA “Second Look”
Majority reform effort. Validity of any suspect future interest is determined on the basis of the facts as they occurred after the death of the measuring life.
Embrace cy pres
Reduction of any offensive age contingency automatically down to 21 years
Reforms to the RAP: Uniform Statutory Rule Against Perpetuities
Codifies the traditional rule against perpetuities period of lives in being + 21 years, provides an alternative 90 year bright line vesting period.
Embrace cy pres
Reduction of any offensive age contingency automatically down to 21 years
Cy Pres
“As Near as Possible”
Gives the court the equitable discretion to redraft any offensive grant that as near as possible matches the grantor’s intent while still comporting with the RAP.
Acquiring Possessory Interest by Adverse Possession
May be raised as a defense to ejectment or as an affirmative claim to quiet title.
If AP prevails over TH, title vests in AP.
Elements: Actual entry and use as average owner Continuous Hostile Open/Notorious Exclusive
Exclusive of Title Holder
(1) possession is not shared w/ TH– if TH or any other possessor is on the property without AP’s permission
(2) standard is conduct of ordinary owner– e.g. not objecting to every crossing by hiker is ok for AP, merely being hospitable
Continuous for Statutory Period
Measured by standard of ordinary owner’s usage.
Occasional absences do not disrupt continuity.
Seasonal use: depends on whether sufficient evidence of presence w/ intent to return
May include tenancy of person that AP leases to.
Open and Notorious
Use must be publicly visible. Gives TH opportunity to see AP is possessing.
Different standard for sub-surface intrusion: actual notice
Some jurisdictions also have enhanced notice requirements for boundary disputes in build-up areas
Actual Entry & Use as Average Owner
Measured by standard of ordinary owner. Determined by range of actual and permitted uses in the area. May be defined by statute.
Functions: determines reliance interest of AP. Ensures TH is on notice that AP claims possession.
Hostile
Claim of right/title
1) Objective test: AP does not have permission of TH
2) Subjective tests
- Good faith: AP must enter and posses with good faith belief in right to possess the property
- Bad faith (rejected test): AP must enter w/ intent to possess property they know belongs to someone else
Tacking (Continuous)
Current AP may combine time in possession with predecessor if the 2 are in privity.
- Voluntary transfer from AP1 to AP2.
- Any nonhostile nexus between possessors
- Does not require writing conforming to the statute of frauds
- OUSTER DEFEATS PRIVITY– NO TACKING!
Disabilities
Certain conditions– specified in statute– may delay (toll) the start of adverse possession clock.
Disability must be present at the inception of AP (when AP begins)
Disability only delays the clock, it does not eliminate AP.
Color of Title
Additional Statutory form of adverse possession.
Same elements as AP except
1) enter under document that purports to convey title
2) typically requires good faith, has shorter statutory period
3) if some portion actually possessed, may get constructive possession of full lot described
3 Types of Concurrent Estate
(1) Joint Tenancy: 2 or more own with right of survivorship
(2) Tenancy by the Entirety: protected marital interest between spouses w/ right of survivorship
(3) Tenancy in Common: two or more own without right of survivorship
Joint Tenancy
“I’m a Survivor”
2 or more own Blackacre with the right of survivorship.
(1) Right of survivorship: when 1 joint tenancy dies, that share goes automatically to the surviving joint tenant
(2) A joint tenant’s interest is alienable, but not devisable or descendible—> last survivor standing takes all
How to Create a Joint Tenancy
1) Need the 4 unities in one document
2) Grantor must state the right of survivorship
Joint tenants are disfavored– they get to avoid probate
4 Unities
Time
Title
Identical Shares
Right to Possess the Whole
May use a straw; may convey to both
How to Sever a Joint Tenancy
Survivorship may be terminated by any unilateral act of JTS co-tenant
(1) through transfer of full possessory interest to a 3d party, who then takes as a a TIC w/ remaining co-tenants
(2) through unilateral declaration of intent to hold as TIC, provided that the declaration takes the form of a transfer from a JTS to a TIC and there is sufficient evidence of delivery–> look for state regulations
Joint Tenancy: Claims of Creditors or Other Transferees of Lesser Interests
(1) If grant of mortgage or lease (or other lesser interest) is made by all JTS, then the grant remains valid against surviving JTS
(2) if a grant of mortgage or lease is made by one JTS (A) but not joined by other (B) and A dies while mortgage/lease is outstanding, then in all or most jurisdictions, mortgage or lease evaporates (interest evaporates) and surviving joint tenant takes free of the lesser interest
Joint Tenancy: Lesser Interest Holder Remedy
Mortgagor or tenant may sue the estate of the deceased joint tenant for whatever loss they incur by termination of the interest.
Severing a Joint Tenancy: Sale
A joint tenant may sell or transfer her interest during her lifetime.
May be secret or without consent.
Severs the joint tenancy w/r/t that share (buyer becomes a tenant in common).
If we started with more than 2 joint tenants in the first place, joint tenancy remains intact between other, non-transferring joint tenants
Severing a Joint Tenancy: Partition (2 Variations)
“the Breakup Plan”
Variation 1: Partition by Voluntary Agreement. Parties work out a private partition agreement
Variation 2: Partition in Kind. A court action for physical division of Blackacre if in the best interests of all. Works best if Blackacre is sprawling.
Variation 3: Forced sale. A court action finds it in the best interests of all. Divide proportionally.
How to Sever a Joint Tenancy: Mortgage (Title Theory)
One joint tenant’s execution of a mortgage or a lien on his or her share will sever the joint tenancy as to that now encumbered share only in the minority of states that follow this approach
How to Sever a Joint Tenancy: Mortgage (Lien Theory)
A joint tenant’s execution of a mortgage on his or her interest will not sever the joint tenancy
Right of Partition
Joint tenants and tenants in common have a right to claim partition; any restraints on the right to partition are treated as DROIA and upheld only if rxble in purpose and limited in duration
Right of Partition: Partition in Kind
At common law, the default. Physical division of the property into separate parcels. Where the division could not be made into exactly equal shares, one party could be required to compensate the other for the actual share.
Remains the default when one party is in actual possession and the division can be made w/o undue prejudice.
Right of Partition: Partition by Sale
The property is sold and the proceeds divided according to the co-tenant’s shares
Tenancy by the Entirety
Between MARRIED parties with the right of survivorship.
Recognized in 21 states. Cannot be created in a couple engaged to be wed.
“Can’t touch this”– creditors of only 1 spouse cannot touch this tenancy; neither tenant acting alone can defeat right of survivorship unilaterally. All attempted transfers are void.
Exception: federal tax liens along with some forms of forfeiture for use of the property in a criminal enterprise.
Spouses must be married at the time they take title and also take by same instrument at same time, and receive proportional shares. . If not, tenants in common, or joint tenants with survivorship.
Tenancy in Common
“I’m devisable, I’m descendible too”
2 or more own with no right of survivorship.
(1) Each tenant in common owns an individual part, and each has the right to possess the whole.
(2) Each tenant in common’s interest is devisable, descendible, and alienable. No survivorship rights between tenants in common.
(3) Presumption favors tenancy in common (always subject to probate)
(4) Tenant in common’s proportional interest is subject to the claims of creditors
Tenancy in Common: Possession
Each co-tenant is entitled to possess and enjoy the whole.
If one co-tenant wrongfully excludes another co-tenant from possession of the whole or any part, he has committed OUSTER, an actionable wrong
Tenancy in Common: Rights and Remedies
(1) Right to use and enjoy all of shared interest
(2) Right of partition
(3) Liability for rent
(4) Liability for taxes, repairs, or improvements
(5) Liability for waste
Remedy for Waste: Monetary Damages
Money damages for diminished value of the remainder, esp. when claim is brought at the end of a life estate.
Remedy for Waste: Injunctive Relief
May have court order to block changes or repair damage
Remedy for Waste: Forfeiture of the Life Estate, Leading to Acceleration of Vested Remainder or Reversion into Possession
If remaining value of life estate (based on actuarial tables: Y remaining years of life expectancy x $Z annual value of life estate) is less than the value of damages
Remedies for Waste
(1) injunctive relief
(2) Monetary damages
(3) forfeiture of life estate, leading to acceleration of vested remainder, or reversion into possession
Liability for Rent: Ouster
If one co-tenant ousts the other co-tenant, the co-tenant in possession owes the ousted co-tenant the FMV rent of the ousted co-tenant’s portion of the interest
Liability for Rent: If No Ouster
1) Tenant out of possession is not ordinarily entitled to rent from the tenant in possession. BUT if tenant in possession asks the tenant out of possession to contribute to the upkeep of the property, the tenant out of possession can require the tenant in possession to offset any such liability by FMV rental share of tenant in possession
2) Rent from a co-tenant in exclusive possession: absent ouster, a co-tenant in exclusive possession is not liable to the other co-tenant for rent
Liability for Rent: Rental to 3rd Party
If one co-tenant purports to rent entire co-tenancy to 3rd party, that co-tenant must be willing to share rents she actually received with other co-tenant. If the other co-tenant does not elect to joint the lease, then she may exercise her full right of possession as co-tenant, despite the 3rd party lessee’s expectations based on the lease.
Co-Tenants: Adverse Possession
Unless he has ousted the other co-tenant, the tenant in exclusive possession cannot acquire title to the whole to the exclusion of the other co-tenant (no hostility)
Liability for Taxes: Carrying Costs
Tenants expected to pay proportionate share, but if one tenant is in sole possession (no ouster), the tenant out of possession can demand that the tenant in possession offset the value of the FMV rent from the claim to contribute to payment of taxes.
Fair share: undivided interest in the whole
Liability for Repairs
A repairing co-tenant enjoys a right to contribution for reasonable and necessary repairs provided that she has told the other of the needs for repairs.
Some jurisdictions treat like taxes (especially if obviously necessary, provided non-repairing co-tenant gets notice), like replacement of damaged roof.
Others treat repairs like improvements, with no obligation to contribute
Liability for Improvements
No obligation to share in the cost of improvements; but improving co-tenant can recover value of improvement at time property is sold and also bears full liability for any drop in value caused.
Liability for Waste: Destruction of Buildings
Because co-tenants are allowed to make improvements, there is no liability simply for changing the property.
HOWEVER, if the changes diminish the value of the property, a non-consenting co-tenant may claim damages for waste.
Liability for Waste: Non-Renewable Resources
A co-tenant who extracts mineral wealth must account to co-tenant for profits received by the extraction.
Ameliorative Waste
Current possessor takes actions that materially change the structures or use of the property, but the change enhances the economic value of the property for future possessors.
Ameliorative Waste: Most Defensible
A material change in use will be especially defensible if the surrounding property uses have also changed considerably during the life estate, rendering continued use in its received condition both inconsistent with other uses, and also very unlikely that the future possessors would want to use it for its received condition
Ameliorative Waste: Majority Rule
Permit reasonable changes to the use, even if it involves substantial alteration of the property, provided it actually improves the use of the property
UNLESS
1) grantor expressly barred it or
2) future possessors have some rxble and identifiable subjective basis for delivery in unchanged state
Ameliorative Waste: Common Law
Actionable: current possessor (or his estate) could be ordered to restore the prior use or pay damages for the change
Rights and Duties of Co-Tenants: Waste
A cotenant must not commit waste. A cotenant will be liable for any waste committed during the co-tenancy.
An action for waste resides during the lifetime of the co-tenancy.
Rights and Duties of Co-Tenants: Partition
Any joint tenant or tenant in common has the right to bring an action for partition
4 Leasehold Interests
(1) Tenancy of/for years (AKA term of years, estate for years)
(2) Periodic tenancy
(3) Tenancy at will
(4) Tenancy at sufferance
Tenancy of Years
Lease for a fixed period of time. As long as you know the termination date from the start, you have a term of years. No notice needed to terminate.
Note: a term of years greater than 1 year must be in writing to satisfy the statute of frauds.
Periodic Tenancy
Tenancy that continues for successive intervals until landlord or tenant give proper notice to terminate.
It endures continuously for successive intervals.
Can be created expressly (Ex: LL conveys to T from year to year).
Can also arise by implication
Notice is needed to terminate!
3 Ways for Periodic Tenancy to Arise by Implication
(1) When land is leased with no provision of duration, but provision is made for the payment of rent at regular intervals
(2) Oral term of years in violation of the statute of frauds creates an implied periodic tenancy based on how rent is tendered
(3) Holdover doctrine: if LL elects to hold over a tenant who has wrongfully stayed on beyond the expiration of the original lease. Based on how rent is tendered.
Notice
At common law, notice must be given at least equal to the length of the period itself.
Exception: if the lease ran from year to year or more, only 6 months notice would be needed.
Parties may alter notice period by contract
Modified by statute in most states.
Usually written.
Tenancy at Will
Tenancy of no fixed duration. Endures at the will of either the LL or the T.
Ex: to T, for as long as LL or T desire
Terminable at the will of either party. Significantly curbed by modern statute (rxble demand to quit/vacate needed).
Unusual.
Tenancy at Sufferance
Created when a tenancy has wrongfully held over, past the expiration date of the lease.
Presence of a pending eviction.
Give this wrongdoer a leasehold interest (tenancy at sufferance) to allow the LL to collect rent/proceed against wrongdoer
Always short lived, until successful eviction
Tenant Duties (5)
(1) Duty to pay rent
(2) Duty not to commit waste
(3) Duty to vacate at the end of leasehold term
(4) Duty to repair (maintain premises)
(5) Liability to 3rd parties
Tenant’s Liability to 3rd Parties (Tort Law)
T is responsible for keeping the premises in rxbly good repair.
In tort, T is liable for injuries sustained by 3rd parties she invited, even when LL has expressly promised to make all repairs.
LL is under NO DUTY to make premises safe (caveat lessee)
5 Exceptions: CLAPS Common Areas Latent Defects Assumption of repairs Public use Short term lease of a furnished dwelling
Tenant’s Duty to Maintain Premises (Repair)
A tenant must simply maintain the premises and make ordinary repairs (maintenance) other than ordinary wear & tear.
Must not commit waste (affirmative, permissive, ameliorative).
Tenant’s Duty to Repair and the Law of Fixtures
When T removes fixtures, she creates voluntary waste.
Fixture: once movable chattel attached to realty with intent to permanently improve realty. Passes with ownership of the land.
Any express agreement controls.
If no express agreement, T may remove if removal won’t substantially harm premises. If damage–> objective.
Tenants’s Duty to Repair When Tenant Has Expressly Covenanted in Lease to Maintain Property in Good Condition for Duration of the Lease
At common law: T was responsible for any loss to the property, including loss attributable to force of nature
Today’s majority view: T may end the lease
Tenant’s Duty to Pay the Rent: Breached but Still in Possession
Tenant at Sufferance.
1) Proceed against wrongdoer for eviction through courts (summary eviction proceedings)
2) Continue the relationship and sue for rent owed.
LANDLORD MUST NOT ENGAGE IN SELF HELP.
Tenant’s Duty to Pay Rent: Breached and Not in Possession
Ex: Tenant wrongfully leave a term of years.
SIR
S: Surrender (treat tenant’s vacating as a tacit offer of surrender; if lease is for 1 year or more, must be in writing to comply with statute of frauds). Sue for breach
-time expected to be vacant
-cost of replacing tenant
-different in value between T’s rent and FMV
I: ignore the abandonment and hold tenant liable (minority of states)
R: Relet the premises. Hold liable for any deficiency.
- time vacant
- cost of replacement
- difference in value between T and new T’s rent
LL must mitigate in most jurisdictions.
Landlord’s Duty: Deliver Possession
LL must provide tenant with LEGAL possession: legal right to be there (lease) and keys
LL must provide residential tenant with ACTUAL PHYSICAL possession: if at start of T’s new lease, a prior holdover is still in possession, LL has breached, and T gets damages
Landlord’s Duty: Implied Covenant of Quiet Enjoyment
Applies to both residential and commercial premises.
Implicit promise to provide T with quiet use and enjoyment. LL’s promise not to unreasonably interfere with tenant’s possession and use of premises.
Breached by:
(1) Actual wrongful eviction
(2) Constructive eviction
Constructive Eviction
Landlord’s actions or pattern of actions gives T no choice but to vacate the premises.
Aggrieved T must SING
SI: substantial interference due to LL
N: tenant must NOTIFY LL, and LL fails to act
G: goodbye/get out (T must vacate) after LL fails to remediate
Is LL liable for the bothersome conduct of other tenants?
As a general rule: No.
2 Exceptions:
1) LL must not permit a nuisance on site
2) LL must control common areas (hallway, stairwell)
Landlord’s Duty: Implied Warranty of Habitability
Implicit promise by all RESIDENTIAL landlords.
Nonwaivable. Premises must be fit for basic human habitation. Elaborated on by caselaw and statute.
Problems that trigger: plumbing, running water, heat
What are the Aggrieved Tenant’s Entitlements When the LL Has Breached the Implied Warranty of Habitability?
MR3
Move out! End the lease BUT she doesn’t have to
Repair and deduct (permitted by statute)
Reduce rent or withhold all rent until the court assess fair rental value in view of the premises defects (withheld funds to to escrow)
Remain in possession, pay rent, and sue LL for damages
Landlord’s Duty: Refrain from Committing Retaliatory Eviction
LL must not take reprisal against a good faith, whistle blower tenant.
LL must not harass, raise rent, move to evict, or take any other reprisals against repairing tenant. Will lead to damages.
If T raises good faith claim of implied warranty of habitability, unless LL able to overcome presumption that eviction (or refusal to extend lease) is based on T’s exercise of rights), LL will be found to have engaged in retaliatory eviction.
Landlord Duties
(1) duty not to discriminate
(2) duty to deliver possession
(3) covenant of quiet enjoyment
(4) Implied Warranty of Habitability
(5) Protection from Retaliatory Eviction
(6) Right to Renewal of Tenancy
Duty Not to Discriminate
Duty not to discriminate in provision of rental housing. Statutes define:
a) protected classes
b) prohibited acts
c) exempted actors (i.e. owner-occupants)
What are the Aggrieved Tenant’s Entitlements When the LL Has Breached the Duty to Deliver Possession? 3 Options
(1) Treat lease as terminated; sue LL for any damages in finding substitute housing
(2) Assert continuing right to possession, sue LL for costs of finding substitute housing until actual possession is delivered
(3) Sue current wrongful possessor of leasehold premises
Who Can Breach the Covenant of Quiet Enjoyment?
(1) LL or LL’s agents
(2) Any person who holds superior title to LL (i.e. if LL holds a life estate and died during leasehold, T could sue LL’s estate if evicted by remainder holder
(3) other tenants, if L has authority to control their conduct or L should have foreseen harm and failed to take steps to prevent (more uncertain/controversial)
Before Invoking Remedies for Breach of Covenant of Quiet Enjoyment, T Must…
Give LL notice and opportunity to cure.
Note: remedies for actual eviction relate back to the time of intrusion.
Covenant of Quiet Enjoyment: 3 Modes of Breach
(1) Actual eviction: physical dispossession
(2) Constructive eviction: conditions make continued possession effectively impossible (even though T retains legal and actual possession)
(3) Substantial interference
Covenant of Quiet Enjoyment: Actual Eviction
Physical dispossession.
a) Total: exclusion from entire leasehold.
b) Partial: exclusion from any portion of leasehold.
Covenant of Quiet Enjoyment: Actual Eviction Remedy
Common law: any actual eviction entitled tenant to cease paying any rent, even if eviction was only partial.
Assignment
Arises whenever the tenant transfers everything she has left under the original lease to another.
LL & T2 (assignee) enter into privity of estate.
If T2 (assignee) transfers interest to another assignee, assignee A is no longer liable to LL for any breach.
Privity of Estate
Born of possession. LL-T2.
They are liability to each other for all of the covenants in the original lease that run with the land.
Ex: promise to pay rent, repair the premises, etc.
Not in privity of contract.
T1 and LL no longer share in privity of estate.
Sublease
Arises when T1 (sublessor) transfers less than everything she has under the terms of the sublease.
T1 retains right to retake possession.
(1) time remaining at the end of the sublease
(2) right to oust subtenant for breach of sublease
T1 and T2 are liable to one another
LL and T1’s relationship remains fully intact.
LL and T2 are in neither privity of estate or contract.
LL may assert equitable remedy (eviction). Some states may permit assertion of damages.
